No backing down on super profits tax

Prime Minister
Kevin Rudd
has refused to back down on the resource super profits tax despite criticism from Australia's leading public economist and threats of legal action.

Professor
Ross Garnaut
said the federal government should be prepared to change the tax and listen to the debate, warning that treasury had wrongly made assumptions about the cost of new projects.

West Australian Attorney-General
Christian Porter
said the proposed tax faces a constitutional challenge in the high court with the WA government claiming its economy could be undermined by the tax grab.

Mr Rudd insisted the new tax was in Australia's best interests and would provide better superannuation, tax cuts for businesses and investment in future infrastructure.

"It's pretty important to focus on the need to bring about a reform for the nation which makes a difference for the competitiveness for all businesses," he told reporters in Geelong on Friday.

"The core element for businesses right around the country is the need to have better company rates because currently they are becoming less competitive against the company tax rate applied right around the world.

"We're using this change for the mining industry to bring down the company tax rate by two percentage points nationwide."